March 2, 2017
However, Enterprise Zones have changed over the years. The incentives given to developers to encourage speculative development have gone and been replaced with more modest incentives that have led to a slower rate of building, albeit over numerous sites spread across the region.
The latest round of Enterprise Zones will go live from April 2017. These were announced in the Autumn Statement 2015. Ten of these sites will be within the North East LEP area with new sites spread from Berwick to Sunderland.
These sites are in addition to the initial sites from the first round launched in April 2012. These sites are largely grouped around the A19 corridor, North Bank of the Tyne and Port of Blyth.
Two of the more notable of the new sites are at Newcastle Airport and the International Advanced Manufacturing Park (IAMP) next to Nissan on Wearside. Newcastle International Airport Business Park is a 70-acre site providing 175,000 sq ft of new Grade A offices together with 500,000 sq ft of logistics and manufacturing space in a strategic site on the edge of the city and next to one of the most strategically important transport hubs in the region.
New occupiers will receive discounts in business rates and other incentives to drive occupation.
IAMP is a 62-acre site that sits immediately next to the Nissan manufacturing site in Washington. It promises to attract £300 million of new investment specifically supporting the development of businesses operating in the low carbon and automotive sectors.
The site can provide up to 675,000 sq ft of new space and can offer enhanced Capital Allowances to incoming tenants.
The majority of the Enterprise Zone sites are focused on manufacturing, reflecting the regions’ strengths and supporting the Government’s new industrial strategy, particularly around the automotive and offshore sectors. These will largely deliver bespoke buildings for occupiers rather than see speculative development.
The Newcastle Airport Enterprise Zone will offer both office and manufacturing/logistics opportunities. The site is strategically located not just for the airport, but also for access to the A1 and the Newcastle conurbation. Here, it is likely that self-contained offices from 15,000 sq ft upwards will be delivered. With Newcastle City Centre availability down to 2.5 per cent, this could provide urgently required new office stock for expanding occupiers.
Quorum Business Park, located in north Newcastle and managed by Broadoak Asset Management, is a good example of one of the successes from the last round of Enterprise Zones. The 1 million sq ft park has now attracted 25 businesses employing more than 6000 staff. As well as being the headquarters of leading Newcastle businesses such as Greggs, British Engines and NCFE, it has also attracted some notable Inward Investment wins.
Companies such as Tesco Bank, Balfour Beatty, Insure the Box, Engie and Ebiquity all considered other parts of the country before deciding to come to Quorum, on the Newcastle/North Tyneside boundary. Between them, these projects have brought over 2250 new jobs to the city.
Having the available space and occupier incentives can attract these new jobs, and although the incentives offered by the latest zones are not what they were in the earlier versions, it is hoped that they will still help bring forward the next wave of inward investment wins.
Broadoak Asset Management